Key Takeaways ADSK emerges stronger than FIG with a better earnings outlook, while FIG faces margin pressure.ADSK leverages AI across AutoCAD, Revit and Fusion, with strong adoption of Sketch AutoConstrain tools.FIG expands AI features and users, but margins fell 22%, and shares plunged 58.7% in six months.Figma (FIG) and Autodesk (ADSK) are two of the largest players in the design SaaS space, catering to different end markets while being transformed by AI. Figma offers collaborative digital product design, ...

Group 1 - The core focus of Autodesk's recent performance is its strong fiscal fourth quarter, showcasing resilience amid macroeconomic uncertainty, with better-than-expected results in billings, revenue, margins, and free cash flow [3] - Autodesk is expanding its Construction Cloud and Fusion platforms to encompass the entire lifecycle of physical assets, while also enhancing its cloud and AI capabilities, driven by trends in construction digitization, manufacturing modernization, and global infrastructure investment [4] - The company is implementing a restructuring plan that includes a 7% workforce reduction, aiming to utilize the savings to boost investments in artificial intelligence and research and development, with expectations of achieving an additional 75 basis-point margin expansion following a previous 200 basis-point improvement in fiscal 2026 [5]

Core Viewpoint - Autodesk is experiencing durable growth driven by diversification across various sectors and geographic markets, despite macroeconomic volatility [1][3][5] Group 1: Business Performance - Autodesk has shown consistent growth over the past several years, supported by expansion activities and new business opportunities [2][5] - The company has a construction backlog of approximately eight to ten months, which sustains demand even amid external uncertainties [2] - The fourth quarter performance was strong across all verticals and geographies, with particular strength noted in data centers and industrial buildings [2][3] Group 2: Strategic Initiatives - Autodesk's investment in cloud technology, artificial intelligence, and go-to-market changes is yielding benefits, positioning the company for further margin expansion [3][5] - The company is targeting margin expansion despite facing a ~100 basis-point accounting headwind from its new transaction model [5][7] - A workforce reduction of about 7% was completed as part of a broader go-to-market optimization strategy, with savings reinvested into selling, marketing, and core R&D [5][8] Group 3: AI and Automation Strategy - Autodesk's AI strategy focuses on internal productivity gains and three monetization layers: task automation, workflow automation, and system automation [4][10][16] - The company has been investing in AI for nearly a decade, aiming to help customers improve capacity, productivity, and risk management [11][12] - Autodesk's generative AI initiatives, such as Project Bernini, are expected to enhance product offerings and deliver cost-effective results [18] Group 4: Market Position and Future Outlook - Autodesk is expanding its role in the construction phase and aims to extend into the operational phase, potentially increasing project involvement from months to decades [6][19] - The company remains cautious in the near term due to restructuring impacts but maintains confidence in long-term growth drivers supported by secular trends and product investments [19]

Core Insights - Autodesk reported strong fiscal 2026 results, exceeding guidance across key metrics including billings, revenue, non-GAAP operating margin, non-GAAP earnings per share, and free cash flow [3][6][4] - The company anticipates a cautious outlook for fiscal 2027, incorporating potential disruptions from sales restructuring and go-to-market changes [4][10] Financial Performance - Total fourth-quarter revenue grew 19% year-over-year, with a contribution of approximately $137 million from a new transaction model; excluding this, revenue growth was 14% in constant currency [2][6] - Billings increased by 33% as reported and 30% in constant currency, with about $185 million from the new transaction model; excluding this impact, billings grew 32% in constant currency [2][6] - Non-GAAP operating margin rose by 120 basis points to 38%, while GAAP operating margin remained flat due to a $100 million restructuring charge [5][7] Cash Flow and Capital Allocation - Autodesk generated fourth-quarter free cash flow of $972 million, with total share repurchases for fiscal 2026 amounting to $1.4 billion, representing over 50% of free cash flow [8][5] - The company plans to allocate approximately 50% of free cash flow to buybacks over time, subject to acquisitions [13] Fiscal 2027 Guidance - Autodesk's fiscal 2027 guidance includes billings of $8.48 billion to $8.58 billion, revenue of $8.10 billion to $8.17 billion, and non-GAAP operating margin of 38.5% to 39% [4][17] - The guidance reflects prudence regarding potential sales disruptions and assumes a broadly stable macroeconomic environment [10][4] Strategic Focus - The company emphasizes the convergence of design and make in the cloud, driven by platform capabilities, industry clouds, and AI [14] - Autodesk is focusing on AI-driven productivity features, with significant improvements noted in its Fusion product [18] - The company is also targeting monetization of its intellectual property through Autodesk Platform Services (APS) and API usage [22]

Financial Data and Key Metrics Changes - Total revenue in Q4 grew 19% as reported and in constant currency, with a contribution from the new transaction model of approximately $137 million [9][10] - Billings increased 33% as reported and 30% in constant currency, with a contribution from the new transaction model of approximately $185 million [10] - Fourth quarter GAAP operating margin was 22% and non-GAAP operating margin was 38%, with non-GAAP operating margin up 120 basis points year-over-year [11] Business Line Data and Key Metrics Changes - Strength was observed in the AEC (Architecture, Engineering, and Construction) sector, particularly in construction and emerging markets, offsetting softness in commercial [9] - EBA (Enterprise Business Agreement) and product subscription billings were strong, contributing to overall revenue growth [9] Market Data and Key Metrics Changes - The company noted sustained investment in data centers, infrastructure, and industrial buildings in emerging markets, which contributed positively to performance [9] - The transition to annual billings for most multi-year contracts skewed the billings growth rate in fiscal 2026 [10] Company Strategy and Development Direction - Autodesk is focused on the convergence of design and make in the cloud, enabled by platforms, industry clouds, and AI [21] - The company aims to extend its footprint deeper into operations, applying successful strategies from construction to other sectors [22] - Autodesk is enhancing its portfolio with cloud-based platforms that connect design, make, and operate workflows, driving greater value creation [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow at scale and invest in strategic priorities despite potential disruptions from restructuring [15] - The guidance for fiscal 2027 reflects a strong underlying momentum, with expectations for billings growth to be slightly weighted towards the second half of the year due to anticipated short-term disruptions [16][17] Other Important Information - The company repurchased approximately 1.1 million shares for $333 million in Q4, with total share repurchases for the year reaching $1.4 billion [12] - Autodesk's capital allocation framework remains unchanged, prioritizing organic investment in R&D and maintaining a healthy buyback program [19] Q&A Session Summary Question: Can you discuss Autodesk's position in the AI ecosystem and its relationship with LLMs? - Management emphasized that Autodesk aims to combine the capabilities of frontier models and proprietary models to provide superior solutions, leveraging its unique data and context [41][42] Question: How does the guidance for FY 2027 compare to last year in terms of prudence? - The guidance reflects a strong underlying momentum but incorporates prudence due to potential short-term disruptions from the sales optimization plan [46][47] Question: What is the relative positioning of Forma versus Revit? - Forma is focused on cloud and AI-enabled tools, while Revit will benefit from enhancements associated with the Autodesk Assistant, ensuring a seamless transition for customers [52][53] Question: How is Autodesk addressing potential disruptions in the sales organization? - The company has implemented operational guardrails to mitigate impacts on renewal activity while incentivizing new business growth [86] Question: What are customers asking for in terms of AI solutions? - Customers are seeking convergence between design and make processes, desiring fast feedback and intelligent data management to reduce downstream risks [88]

Financial Data and Key Metrics Changes - Total revenue in Q4 grew 19% as reported and in constant currency, with a contribution from the new transaction model to revenue of approximately $137 million [9][10] - Billings increased 33% as reported and 30% in constant currency, with a contribution from the new transaction model to billings of approximately $185 million [10] - Fourth quarter GAAP operating margin was 22% and non-GAAP operating margin was 38%, with non-GAAP operating margin up 120 basis points year-over-year [11] Business Line Data and Key Metrics Changes - Strength was observed in AEC (architecture, engineering, construction) particularly in construction and emerging markets, offsetting softness in commercial [9] - EBA (Enterprise Business Agreement) and product subscription billings were strong, contributing to overall business momentum [9] Market Data and Key Metrics Changes - The company noted sustained investment in data centers, infrastructure, and industrial buildings in emerging markets, which contributed positively to performance [9] - The transition to annual billings for most multi-year contracts skewed billings growth rates in fiscal 2026 [10] Company Strategy and Development Direction - Autodesk is focused on the convergence of design and make in the cloud, enabled by platforms, industry clouds, and AI [21] - The company aims to extend its footprint deeper into operations, applying successful strategies from construction to other areas [22] - Autodesk is enhancing its portfolio with cloud-based platforms and capabilities that connect design, make, and operate workflows [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow at scale and invest in strategic priorities despite potential disruptions from restructuring [15] - The guidance for fiscal 2027 reflects a strong underlying momentum but incorporates prudence due to anticipated short-term disruptions from sales restructuring [16][17] Other Important Information - The company repurchased approximately 1.1 million shares for $333 million in Q4, with total share repurchases for the year reaching $1.4 billion [12] - Autodesk's capital allocation framework remains unchanged, with a focus on organic investment in R&D and targeted acquisitions [19] Q&A Session Summary Question: AI comments and Autodesk's position in the AI ecosystem - Management emphasized that Autodesk's goal is to ensure that its proprietary models combined with frontier models outperform standalone models, leveraging unique data and context [41][42][43] Question: Guidance prudence for FY 2027 - Management indicated that the guidance reflects strong underlying momentum but includes prudence for potential disruptions from the sales optimization plan [45][46] Question: Development of Forma versus Revit and WorldLab technology - Management discussed the importance of integrating Forma and Revit, focusing on cloud and AI-enabled tools, and the potential of WorldLab technology in various applications [50][51][52] Question: Customer AI journey and Autodesk's role - Customers are exploring AI aggressively, seeking to reduce complexity and time in model creation, with Autodesk helping to wrangle data for actionable insights [59][60] Question: Impact of sales organization optimization on renewals - Management explained that operational guardrails were put in place to mitigate disruption during the sales optimization, ensuring renewal activity remains healthy [80][81]

Financial Data and Key Metrics Changes - Autodesk reported total revenue growth of 19% in Q4, with a 14% increase in constant currency excluding the new transaction model [8][9] - Billings increased by 33% as reported and 30% in constant currency, with a contribution of approximately $185 million from the new transaction model [9][10] - Free cash flow for Q4 was $972 million, benefiting from strong billing performance [10] Business Line Data and Key Metrics Changes - The AEC (Architecture, Engineering, and Construction) segment showed strength, particularly in construction and emerging markets, offsetting softness in commercial [8] - The new transaction model contributed approximately $137 million to revenue in Q4 [8] - Autodesk's operating margins were 22% GAAP and 38% non-GAAP, with non-GAAP margins up 120 basis points year-over-year [10] Market Data and Key Metrics Changes - Autodesk's growth was driven by sustained investment in data centers, infrastructure, and industrial buildings [8] - The company noted strong demand in both infrastructure and construction markets, with a focus on digital transformation [23] Company Strategy and Development Direction - Autodesk is focused on the convergence of design and make in the cloud, leveraging AI and platform capabilities to enhance customer workflows [19][20] - The company aims to extend its footprint deeper into operations, applying successful strategies from construction to other areas [19] - Autodesk is preparing to roll out powerful AI capabilities that will enhance task, workflow, and system automation [5][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow at scale and invest in strategic priorities despite potential short-term disruptions from restructuring [12][13] - The guidance for fiscal 2027 reflects a strong underlying business momentum, with expected billings growth impacted by sales restructuring [14][66] - Management emphasized the importance of data, context, and expertise in building competitive advantages in AI [41][42] Other Important Information - Autodesk repurchased approximately 1.1 million shares for $333 million in Q4, with total share repurchases for the year reaching $1.4 billion [10][17] - The company plans to maintain a disciplined capital allocation framework, prioritizing organic investment in R&D and targeted acquisitions [17] Q&A Session Summary Question: Can you elaborate on Autodesk's position in the AI ecosystem and its relationship with LLMs? - Management stated that Autodesk aims to combine the strengths of frontier models and proprietary models to create superior solutions, leveraging its unique data and context [40][41] Question: How does the guidance for FY 2027 compare to last year in terms of prudence? - Management indicated that while there is prudence in the guidance due to potential short-term disruptions, the underlying customer demand remains strong [43][44] Question: What is the relative positioning of Forma versus Revit? - Management explained that Forma is focused on cloud and AI-enabled tools, while Revit will benefit from enhancements associated with Forma, ensuring a seamless transition for customers [50][51] Question: How is Autodesk addressing potential disruptions in the sales organization? - Management highlighted operational guardrails put in place to mitigate disruptions and ensure healthy renewal activity while incentivizing new business [82][84] Question: What are customers asking for in their AI journey? - Customers are seeking assistance in wrangling data and gaining insights to improve efficiency and reduce complexity in their workflows [57][58]

Fourth quarter Fiscal 2026 earnings February 26, 2026 Safe harbor This presentation contains forward looking statements about revenue, billings, free cash flow, operating margin, EPS, products, future performance, financial and otherwise, and strategy, including statements regarding our progress on our key priorities, business models, guidance for the first fiscal quarter and full fiscal year 2027, statements about our utilization and strategy regarding artificial intelligence, statements about our new tran ...

Core Insights - Microsoft is positioned as a long-term winner in the tech sector, driven by cloud leadership and AI advancements, despite recent challenges in stock performance [1][4] - The company has transitioned from traditional software sales to subscription and AI-driven cloud ecosystems, adapting to the evolving tech landscape [2][3] Microsoft Overview - Microsoft has a market capitalization of $2.85 trillion and remains a dominant player in various sectors, including cloud services, productivity software, and gaming [3] - The Azure cloud platform and Microsoft 365 are key components of its business model, supporting global connectivity for businesses and educational institutions [2] Recent Performance - Microsoft shares have experienced a decline of approximately 4% over the past year and nearly 24% in the last six months, with a year-to-date drop of about 20% [7] - Following the Q2 earnings report in January, shares fell 10% in one day, marking the sharpest drop since March 2020, as investor sentiment was affected by concerns over AI-related capital spending and competition [7][14] Financial Highlights - In Q2 fiscal 2026, Microsoft reported a revenue increase of 17% year-over-year to $81.3 billion, with non-GAAP EPS rising 24% to $4.14, surpassing Wall Street expectations [11] - Operating margin reached 47%, and cloud revenue exceeded $50 billion for the first time, reflecting strong demand and a robust revenue pipeline of $625 billion [13] - The company ended Q2 with $89.5 billion in cash and investments, against $40.3 billion in long-term debt, demonstrating a solid financial position [15] Future Outlook - For Q3 fiscal 2026, Microsoft projects revenue between $80.65 billion and $81.75 billion, with Azure growth expected to accelerate to 37%-38% [16] - Analysts forecast a profit of about $4.05 per share for Q3, with full-year EPS estimated at $16.37, indicating a growth rate of approximately 20% [17][18] - The average price target for Microsoft is $595.60, suggesting a potential upside of 53.8% from current levels, with some analysts projecting even higher targets [19] Analyst Sentiment - Analysts maintain a "Strong Buy" consensus on Microsoft, with 41 out of 50 analysts recommending a "Strong Buy" rating [18]

Group 1: Company Performance and Analyst Ratings - Autodesk, Inc. is recognized as one of the 10 Best Consensus Buy-Rated Stocks to Invest in [1] - RBC Capital analyst Matthew Hedberg lowered the price target on Autodesk to $340 from $380 while maintaining an Outperform rating, citing negative investor sentiment and a preference for companies with clearer AI monetization paths [1] - JPMorgan upgraded Autodesk to Overweight from Neutral with an unchanged price target of $319, highlighting its leadership in design and building information modeling software and the rapid adoption of cloud and AI technologies [2] Group 2: Legal Matters - Autodesk filed a lawsuit against Alphabet's Google for alleged infringement of its "Flow" trademark, claiming it began using the name in September 2022, prior to Google's launch of its own Flow software in May 2025 [3] Group 3: Product Offerings - Autodesk provides a range of 3D design, engineering, and entertainment software solutions globally, including products like AutoCAD Civil 3D, Revit, Autodesk Build, BIM Collaborate Pro, BuildingConnected, and Tandem [4]